Air Transport World

Nordeste: struggling for an image while claimants fight over ownership. (Nordeste Linhas Aereas Regionais SA)

Nordeste: Struggling for an image while claimants fight over ownership Salvador, Bahia, Brazil--On the surface the situation at Nordeste Linhas Aereas Regionais SA appears made for guaranteed success, a marketing executive's dream: serving a government-protected territory; a one-type aircraft fleet of paid-for, domestic airliners; no competition.

With all that on a regional airline's side, what could possibly go awry?

Well, for starters, management could go several years without filing tax forms or balancing company books while, at the same time, siphoning off company funds. Add to that aircraft maintenance records in a shambles, declining market share, and throw in the Departamento de Aviacao Civil's (DAC, the Brazilian aviation regulatory body) discovery of management's contretemps. DAC intervened in March 1986 to keep the carrier from going under.

Finally a courtroom contest for ownership of Nordeste pits the state government of Bahia against a group of private businessmen headed by Otto Lima, the owner of a nearby air taxi operation.

Other than that, everything is just fine for Nordeste, the Brazilian regional serving the Northeast section of the country. In mid-December the staff at carrier headquarters in Salvador had just finished balancing the books for 1984 and 1985. …

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